GE Hopes the Industrial Internet will Mean the End of Downtime

Reporter

In GE’s vision of the future, the company will be able to fix or replace its products before they ever break. In that world, airlines will receive notices from GE many miles before a jet engine part is likely to fail, railroads will be able to avoid derailments, appliance repair people will be able to diagnose problems remotely, and hospital administrators will be better able to allocate sparse resources to patients. That future hinges on the ability of those devices to communicate status updates collected from sophisticated sensors over an industrial Internet that connects people to machines and machines to one another, much in the way that people are connected over the Web today.

While the potential of this technology has been discussed for years, there are signs that it’s finally gaining traction in the present. GE hopes to be an agent of this change — and a beneficiary of it as well by building this technology into its products and hoping its customers buy it. The Internet of Things, or the industrial Internet as GE terms it, has the potential to add $10-$15 trillion to global GDP by 2030, according to a report issued by the company Monday. According to the report, a 1% increase in efficiency generated thanks to the Internet of Things can mean savings of $30 billion in aviation, $66 billion in power generation and $63 billion in healthcare over 15 years. While self-serving, this research highlights that a much- and long-hyped technology is finally maturing, and that some people have finally figured out what to do with all these masses of data that Big Data and the Internet of Things are making available.

But customers should also bear in mind that GE is trying to promote this vision of an industrial Internet at a time when cybersecurity of industrial control systems is under threat, particularly in the utility sector into which GE is selling heavily.

Those issues aren’t cooling GE’s ardor.“The ability in our world to go man to machine, the ability to marry real-time customer data with real-time performance data of our products – to me that’s the holy grail in our business,” said GE CEO Jeffrey Immelt at Salesforce’s Dreamforce conference in September.

Over time, those status updates will make it possible for GE to learn more about how its jet engines perform and to be able to improve the efficiency of those products. “If we can save, just in the GE installed base, 1% on fuel burn, that’s worth $2 billion in profit at airlines around the world,” said Immelt.

These kinds of results aren’t limited to aviation. For example, about 1,000 GE Appliance field technicians care for 130 million appliances in homes and businesses across the United States. In June, GE introduced a home service repair program that lets technicians connect laptops loaded with analytics software to a new generation of appliances with Ethernet ports. That service makes it easier for technicians to more quickly and accurately diagnose problems. In the future, the cloud-based analytics software will collect information about the appliances, including temperature and events that wear down the machine. The software would anticipate possible problems and inform GE when parts need to be replaced. That means technicians show up at customer homes with the correct part in hand, eliminating additional service trips.

Already, sensors on trains are transmitting information back to rail companies, and real-time diagnostics and predictive analytics software are preventing machine breakdowns before they happen. Union Pacific, the nation’s largest railroad company, can now predict certain kinds of derailments days or weeks before they are likely to occur. The program analyzes data from acoustic and visual sensors on the underside of each rail car. While those sensors have been in place for a decade, they’ve only been able to help technicians spot imminent problems with tracks and wheels. Now, with predictive analytics, the company can spot dangerous conditions well in advance of a problem, CIO Lynden Tennison told CIO Journal in March. Major derailments can result in $20 million to $40 million in damages and significant delays. GE Transportation estimates that 2.5% of rail operations costs – about $5.6 billion per year globally — are the result of system inefficiencies, whether it’s a derailment or waste in fleet scheduling.

GE is busily selling data services of this kind to its industrial customers. Vince Campisi, CIO of GE’s Intelligent Platforms division, told CIO Journal, “we have a heritage and domain history to make us able to more effectively leverage that [industrial Internet] technology, and now that comes in packages that customers can buy and leverage for their own companies.”

GE says hospitals, for example, can better track equipment and manage patient beds with software GE sells. That software can pick up the location of thousands of pieces of critical equipment in a hospital through sensor signals on machines. Much of that equipment is mobile and such software saves nurses from running from room to room searching for it. GE’s report estimates it could translate into an added hour of productivity for healthcare workers on each shift. Better utilization and tracking of equipment can also translate into a 15% to 30% reduction in hospital equipment costs.

A similar “care traffic control system” can better manage placement of patients in hospital beds and an increase in patient throughput by 15% to 20%. Using optimization and modeling software helps New York City’s Mount Sinai Hospital better manage hospital beds and the admitting of patients, according to an article by the New York Times’ Steve Lohr. The savings for a hospital using such software can amount to $120 million over several years and result in the hospital being able to see 10,000 more patients each year, the article says.

The GE report also devotes considerable attention to how the industrial Internet will impact energy companies. Yet, the report fails to discuss at any great length the security implications of creating a network linking all these machines. The biggest threat isn’t likely that machines will rise up against humanity in the manner ofthe Terminator’s Skynet. Rather, it’s that connecting these systems using standard communication technologies, such as the Internet Protocol, make it more likely that those systems will be attacked successfully. Chevron, Saudi Aramco, Rasgas and other companies have been hit by cyberattacks in recent years, but have been able to largely contain any damagesand to keep them from impacting their production networks.

Yet, the possibility of creating efficiencies and saving money will be enticing to many executives. Last year Air Canada signed an agreement with GE Aviation to use its myEngines digital app suite that helps companies manage their engine fleets and improve productivity. Air Canada operates a fleet of GE engines in its aircraft. In 2011, commercial jet airplanes from Air Canada and other airlines were in the air for about 50 million hours, translating into a $60 billion annual maintenance bill. Engine maintenance alone accounts for $25 billion of that. With an industrial Internet tracking engine parts and communicating back to its manufacturer, GE figures that airlines will reduce commercial jet engine maintenance costs by $250 million for every 1% improvement in engine maintenance efficiency.

That’s a vision of the future that CIOs can buy into today – or a flavor of Kool-Aid they can willingly drink, depending on your perspective.

Comments (3 of 3)

In a lot of ways utilization of Bid Data only became possible now due to both the computation speed and accumulation of exabytes of dormant date we can extract value from to change the world. I also do see the future opportunity in the predictability software, build on revolutionary proprietary mathematics formulas in probability and reliability applied within the big data environment.

I found Andrew Stein's response right on the target! Thank you.

5:42 pm November 27, 2012

Andrew Stein wrote:

The true and ultimate ROI for these systems is the loop-back of field operations information (use and performance statistics) that drive better design for next generation items for aerospace, healthcare, appliances - and more.

While preempting and predicting proper service during a maintenance call for an appliance, hospital equipment or aircraft engine is interesting - that only improves existing processes and quality by automating existing manual, and human-based activity. Unfortunately, "predictive" analytics still involves too much human error. Predictive Analytics products from SPSS, SAS, IBM, SAP, Oracle, et. al., are still one step behind.

The next generation is going to be "Prescriptive" analytics, where statistically relevant information is looped back into the design process, to improve design by prescribing changes in them, generation after generation. This is the ultimate result from an industrial internet connection that is necessary to improve standard of care in hospitals, reduce failure in the airline industry, and even make our appliances perform more flawlessly.

What's missing in this story, and unfortunately, also missing in design software initiatives from the leaders (Autodesk, Dassault, Siemens, et. al. who are just now porting design tools to the cloud) is a legitimate Big Data story that makes this connection. It should have happened years ago - as it is a no-brainer decision to improve standards of care and reduce human error introduced by manual inspection.

Jeffrey Immelt's vision works if it connects not only the devices via the industrial internet to the MRO / maintenance systems, but also all the way back to a big data solution (yet to be created) that automatically drives design of next generation devices. I'm available, along with other visionaries, to help Imelt achieve this.

In this second article in a two-part series, Sonny Garg, senior vice president and chief information and innovation officer at Exelon Corp., the $27.4 billion competitive energy provider based in Chicago, describes the structure and inner workings of his emerging technologies team.